Scotland is predicted to achieve 2 per cent annual growth in overseas sales by 2017, outstripping the UK average of 0.3 per cent.
However, Scotland is expected to be only the fifth-fastest growing export region in the UK. The Ernst & Young UK Goods Global Monitor predicts the west and east Midlands will enjoy overseas sales growth at an average of more than 8 per cent and 6 per cent per year, respectively. The UK average is set to be dragged down by stalling rates of exports in the north-west and south-east of England and Wales.
E&Y believes that Scotland is set to benefit economically from the Glasgow 2014 Commonwealth Games, with “brand Scotland” having the potential to reach up to 1.5 billion people. But this will hinge on “showcasing key industries, creating new relationships and developing business opportunities”.
Finance secretary John Swinney hailed the findings as good news for Scotland. “This report recognises the huge economic opportunities that the 2014 Games offers Scotland,” he said.
“Scottish companies have already won approximately 75 per cent of the Games’ contracts let by the Organising Committee and this Government is determined to build on that, through the delivery of a business legacy programme, delivered by Scottish Enterprise and VisitScotland working collaboratively with Scottish business.”
The E&Y report said that Scottish manufactured exports are set to jump in value from £18.2 billion in 2012 to £20.1bn by 2017, with products made by the chemicals, engineering, beverage and aerospace industries at the core of growth.
Jim Bishop, E&Y Scotland senior partner, said: “It’s stunning to consider that the Commonwealth makes up 30 per cent of the world. That incorporates a couple of billion people in some of the fastest-growing economies where Scotland is exporting.
“This is a once-in-a-generation opportunity for Scotland’s UK goods exporters to help reshape the recovery, tapping into the sharp end of truly global supply chains, like chemicals and engineering, and made-in-Scotland heritage brands.”
Bishop said that goods manufacturers must “move away” from a reliance on traditional Western trading partners and tap into “rapid-growth trade corridors” such as Venzuela, Latvia and Australia where the highest growth over the next five years is expected to come, albeit from a low starting point.
E&Y predicts Scottish exports to France will see a decline of 12.6 per cent, with a drop of 11.1 per cent in goods exports to the Netherlands
Bishop added that “harnessing” the global appetite for UK products will “help underpin the recovery of our largely services-based economy”.
E&Y said that, while exports of services remain “the principal engine of recovery”, it insists manufactured goods – which account for nearly half of all UK exports – still make a “vital contribution to the economy”.